It's easy to match the overall market return by buying an index fund. But if you buy individual stocks, you can do both better or worse than that. Investors in Centaur Media Plc (LON:CAU) have tasted that bitter downside in the last year, as the share price dropped 24%. That falls noticeably short of the market decline of around 4.1%. Longer term investors have fared much better, since the share price is up 16% in three years. On the other hand, we note it's up 8.1% in about a month.

So let's have a look and see if the longer term performance of the company has been in line with the underlying business' progress.

View our latest analysis for Centaur Media

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the unfortunate twelve months during which the Centaur Media share price fell, it actually saw its earnings per share (EPS) improve by 57%. It could be that the share price was previously over-hyped.

It's surprising to see the share price fall so much, despite the improved EPS. But we might find some different metrics explain the share price movements better.

Revenue was fairly steady year on year, which isn't usually such a bad thing. But the share price might be lower because the market expected a meaningful improvement, and got none.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

We know that Centaur Media has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on Centaur Media's balance sheet strength is a great place to start, if you want to investigate the stock further.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Centaur Media's TSR for the last 1 year was -19%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence!